billions expected
Deutsche Bank pays dividends again
01/26/2022 9:23 p.m
Group CEO Sewing has been fundamentally reorganizing Deutsche Bank since 2018. Apparently successful, because for the first time in many years, the financial institution is likely to announce a profit in the billions. Investors benefit – but not as much as expected.
Deutsche Bank wants to buy back shares with a volume of more than 300 million euros and, in contrast to the previous year, pay out a dividend again. The share buyback should be completed in the first half of the year, the Dax company announced after the stock exchange closed. All permits are in place.
Shareholders are to receive 20 cents per share for the past financial year. Experts had recently expected more. According to the information, Deutsche Bank is planning a capital distribution of around 700 million euros to its shareholders. This should be the first step in the goal of distributing capital of five billion euros over time. On the Tradegate trading platform, the share price rose slightly in an initial reaction.
In all likelihood, Deutsche Bank increased its profit significantly last year. Analysts expect an increase in the billions for the full year 2021. The group will publish the exact figures on Thursday morning at 7 a.m. Afterwards (10 a.m.) CEO Christian Sewing and CFO James von Moltke will answer questions from investors and journalists in a digital press conference.
Investment banking as a profit maker
As in the previous year, the profit maker is likely to have been investment banking, in which the bank earns money, for example, by trading bonds and currencies. In addition, it became apparent over the course of the year that the institute had to set aside significantly less money for possible loan defaults than in the Corona year 2020.
According to the estimates, the pre-tax profit for the full year 2021 rose from a good one billion euros in the previous year to around 3.5 billion euros. The net profit increased accordingly from 624 million to almost 2.1 billion euros. Interest payments to the holders of certain bonds still have to be deducted from this, so that the bottom line should be a good 1.6 billion euros in profit.
In 2020 as a whole, Deutsche Bank made a profit again for the first time after five years of losses in a row with 113 million euros. According to analysts, however, Deutsche Bank slipped into the red in the final quarter of 2021. The institute had previously closed positively for five quarters in a row. The CEO Sewing, who has been in office since April 2018, had ordered the institute to undergo a fundamental reorganization, including the elimination of thousands of jobs.